Astra to float bonds worth Rp 400b in 1997

Astra to float bonds worth Rp 400b in 1997

JAKARTA (JP): The widely diversified PT Astra International
will float bonds worth Rp 400 billion (US$172.4 million) in the
local market to refinance its short-term loans, the company
announced yesterday.

T. Permadi Rachmat, the president of the publicly listed
Astra, said the five-year bonds would be offered to the public in
the middle of January and be listed on the Surabaya Stock
Exchange on Jan. 29.

He said the interest or yield rates of the bonds had not been
decided. "It will most likely be a fixed rate," he said.

Permadi said that Pefindo, the country's only rating agency,
had assigned an A minus rating on the five-year bonds, the
highest rating to be given to private companies.

"So far the A minus rating is the highest to be given by
Pefindo to an Indonesian private company," he said, adding that
due to the high rating the bonds would not need a sinking fund, a
fund set up to pay off a debt when it falls due.

Astra, which is involved in a wide range of businesses
including automotive, finance, heavy equipment and agribusiness
activities, issued in July Eurobonds valued at $200 million.

Expansion

Astra, which is the largest producer of cars in Indonesia, is
pursuing a huge expansion in all of its divisions in the next
five years.

In its automotive division, Astra plans to increase its Toyota
Group's production capacity in the year 2000 from the current
100,000 vehicles to 150,000 vehicles per year, while Astra
Mobil's capacity will be from the current 160,000 vehicles to
210,000 vehicles per year.

Astra, which produces cars under the trademarks of Toyota,
Daihatsu, Isuzu and Nissan, will also produce a new car, called
ASEAN Family Car -- with a 40 percent local content in 1998.

Asked how the company will compete in the 2000s when a number
of locally made cars enter the market, he said the company will
increase the new car's local content to 60 percent by 1998, which
according to a government regulation will qualify the company for
tax breaks.

Permadi was upbeat that although there would be more new cars
entering the market, Astra would be able to maintain a share of
about 50 percent in the local automotive market in the 2000s.

The Astra Group aims to make its bank one of the five biggest
in Indonesia by the year 2000, with 200 branches and one million
clients.

It will also strive to become the biggest producer of
construction equipment. In 2000 it will produce forklifts under
the trademark of Patria, to be exported to European countries,
Australia and ASEAN countries.

The Astra Group's consolidated net profit until July this year
reached Rp 248 billion, of which 78.7 percent was contributed by
its automotive division, 9.2 percent by its financial division,
5.9 percent from heavy equipment, 4.7 percent by agribusiness and
the other 1.5 percent from other industries.

Last year, the company -- with total assets in July this year
amounting to Rp 17.2 trillion -- posted a consolidated net profit
of Rp 370 billion. (bnt)